Forex Fundamental Analysis & Forecast by RoboForex

[RF roboforex]

The USD was crashed by the Fed’s stance. Overview for 12.12.2019​

The major currency pair reached its five weeks highs influenced by the Fed’s comments after the December meeting.

On Thursday morning, EURUSD is trading close to its five weeks highs. The current quote for the instrument is 1.1138.

The US Fed December meeting, which was over yesterday, offered investors nothing new. The interest rate remained at 1.50-1.75%, the same as expected. However, the comments that followed surprised market players.

The regulator said that the current monetary policy was appropriate and in compliance with its economic purposes. The Fed continues monitoring home affairs and inflation pressure, which is quite reserved. It means that the interest rate wouldn’t be cut unless the regulator witnesses some serious changes in the country’s economy.

It was a pretty unpleasant surprise for the USD because market players were sure that the American economy was strong enough for the rate increase in the nearest future.

The revised forecast from the Fed was a bit worse. For example, inflation is expected to be 1.4-1.5% at the end of 2019 against the previous estimate of 1.5-1.6%.

Later today, investors’ attention will switch to the ECB meeting.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

 

[RF roboforex]

The Pound skyrocketed to its highs. Overview for 13.12.2019​

GBPUSD is heading towards the highs of spring of 2018 after preliminary results of the early parliamentary elections were announced.

The British Pound almost reached the highs of May 2018 against the USD. The current quote for the instrument is 1.3410.

According to the preliminary results, the Conservative party got at least 368 out of 650 seats in the early parliamentary elections that took place yesterday. The party hasn’t seen such strong results for a very long time, while for its opponent, the British Labor Party, they are the worst over 40 years.

Now, the British Prime Minister Boris Johnson has to navigate all necessary documents for the Brexit through the renewed Parliament. This convocation of the Parliament is expected to be more suitable for ratifying the agreement with the European Union. In case everything goes the way as it should, the United Kingdom may exit the alliance within the specified time, before the end of January 2020.

Actually, upsurge in the Pound describes the situation perfectly. It’s amazing that Johnson didn’t cave in to the opposition put up earlier in the House of Commons.

In the short-term, investors’ attention will slowly switch to London-Brussels talks on trading conditions. This week, it was said this week that the parties were very unlikely to have enough time for discussing everything that concerned trade relations and making a deal until the end of January. In this case, the United Kingdom may exit the European Union with a minimum set of trading arrangements. The rest of them will have to be madу off the cuff.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

 

[RF roboforex]

Numbers couldn’t support the Aussie. Overview for 16.12.2019​

AUDUSD is falling early in the week influenced by the strong USD and rather mixed statistics.

The Australian Dollar is retreating against the USD in the middle of December. The current quote for the instrument is 0.6870.

In the morning, Australia reported on the Manufacturing PMI, which dropped down to 49.4 points in December after being 49.9 points in the pre3vious month, thus indicating a continual decline in the sector. The Services PMI in Australia decreased down to 49.5 points after showing 49.7 points in November, which is also pretty bad for the Aussie because should be vice versa due to the seasonality.

Numbers from China, no matter how positive they were, couldn’t support the Australian Dollar. The Industrial Production added 6.2% y/y in November and reached its five-month high after showing +4.7% y/y the month before and against the expected reading of +5.1% y/y. Apparently, the indicator improved because of more active domestic demand – the Chinese government put a lot of effort for that.

The Fixed Asset Investment showed +5/2% ytd/y, just as expected. The Retail Sales added 8.0% y/y in November after expanding by 7.2% y/y in October.

News relating to a possible signature of the first phase of the US-China trade agreement should have a positive influence on the Australian currency.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

 

[RF roboforex]

They continue selling the Australian Dollar. Overview for 18.12.2019​

On Wednesday morning, AUDUSD is still retreating; investors are in favor of the American currency.

The Australian Dollar is falling against the USD in the middle of the week. The current quote for the instrument is 0.6844.

Yesterday, the Reserve Bank of Australia released its December Meeting Minutes. Policymakers came up with an opinion that it would be reasonable to review their economic outlook as early as during the regulator’s meeting in February 2020. The RBA has opportunities to use the necessary tools to give a boost to the country’s economy in case the labor market parameters get worse, but there is no need to do it so far. Apparently, this refers to the interest rate revision. According to the regulator, one should expect an extended period of low interest rates due to both global and domestic factors.

The RBA is a bit concerned about the slow growth rate of household incomes. However, if we take a look at rather cautious numbers in employment, we can see that there is no stress here, it’s just a low-key tendency.

As for the economic outlook, consumers remain very careful and cautious: economic issues are covered in the media in a quite “gloomy” way. However, people’s attitude to their own finance is pretty smooth, and that’s a good thing.

Overall, everything that was in the report was quite expected, because the key thing is that the RBA is ready to cut the rate if necessary. Probably, the conditions for that may appear at the end of the first quarter of 2020.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

 

[Vlad RF]

AUD found support in statistics. Overview for 21.03.2024

The Australian dollar has shifted to an upward trend against the US dollar. The current AUDUSD exchange rate stands at 0.6621.

The Aussie received significant support from the Australian employment market statistics. The number of jobs increased by 116.5 thousand, surpassing the forecasted rise of 40.0 thousand. The unemployment rate in February dropped to 3.7% compared to the expected 4.0%.

Earlier this week, the Reserve Bank of Australia kept the interest rate at 4.35% per annum. It has remained stable for the third consecutive meeting. The current interest rate is the highest in 12 years.

In its commentary, the RBA refrained from signalling further interest rate increases. This shows that the RBA is confident in the inflationary outlook and sees evidence of price cooling.

Additionally, the AUD benefits from the decline in the US dollar.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

GBP found itself amid bears. Overview for 22.03.2024

The UK pound sterling weakened noticeably against the US dollar. The current GBPUSD exchange rate stands at 1.2643.

As expected, the March BoE meeting ended predictably, with the interest rate kept at 5.25% per annum. The regulator's commentaries were restrained. The BoE indicated that the monetary policy would remain restrictive for as long as necessary to control inflation fully.

The Bank of England's inflation target remains at 2%, which the regulator believes can be achieved by the end of Q2 2024. However, no indication was given as to what the BoE intends to do after that.

It appears that the Bank of England is diverging from the general strategy of other global banks regarding interest rates, which is why the pound crashed.

The GBP exchange rate is under additional pressure from the US dollar, which has strengthened noticeably.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

GBP has suspended its decline. Overview for 25.03.2024

The UK pound sterling suspended its falling against the US dollar. The current GBPUSD exchange rate stands at 1.2607.

Last week, GBP suffered a lot. It dropped 1% against USD on Thursday and 0.5% more on Friday after the Bank of England left the interest rate without a change. Everything turned out just as expected but the tone of the BoE’s comments remained rather soft. Two policymakers from the monetary committee denounced their previous calls for raising the lending cost.

However, the experience of the Swiss National Bank that suddenly raised the interest rate last week opens similar doors for other regulators.

The UK pound is not expecting much important statistics. Still there are things to take a look at: on Thursday, the UK GBP reports for Q4 2023 will be presented. According to preliminary estimations, the economy might have dropped by 0.2% y/y after rising by 0.3% previously.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

AUD is inclined to growth. Overview for 26.03.2024

The Australian dollar has moved into positive territory against the US dollar. The current AUDUSD exchange rate stands at 0.6540.

Consumer sentiment in the Australian economy in March retreated from its 20-month peak as concerns about the economic prospects and household finances have come to the fore. According to Westpac observations, the consumer sentiment index lost 1.8% in March after rising by 6.2% in February. The index reached 84.4 points, indicating that pessimists still outnumber optimistic consumers.

The February data provided hope that consumer discouragement that prevailed for the last two years was finally beginning to dissipate. The March report does not confirm this. At best, the momentum will be slow and leisurely.

Last week, the Reserve Bank of Australia kept the interest rate unchanged at 4.35% per annum. It softened its commentary on the likelihood of future interest rate hikes and described the economic outlook as well-balanced.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

JPY is the worst-performing currency of the quarter. Overview for 27.03.2024

The Japanese yen resumed weakening against the US dollar. The current USDJPY exchange rate stands at 151.75.

The latest economic data from the US has cast doubt on whether the Federal Reserve will decide to lower interest rates soon, which pushed the JPY to a 30-year low. The current levels are the ones at which Japan conducted currency interventions in 2022.

The yen is now at its lowest level since the mid-1990s.

This morning, in their commentaries, the Bank of Japan's monetary policymakers and the Ministry of Finance used very similar language to that in 2020, which preceded interventions. While this may not necessarily occur this time, the probability cannot be completely ruled out.

The yen is becoming the worst-performing currency this quarter among those in demand, even after the Bank of Japan abolished the negative interest rate regime. The reason is the huge difference in the cost of borrowing.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EUR continues to lose weight. Overview for 28.03.2024

The primary currency pair is heading downwards on Thursday. The current EURUSD exchange rate stands at 1.0823.

Overall, the market sentiment easily fits into consolidation as the decline does not appear agitated. Investors are conserving energy before new economic statistics from the US are released, particularly before tomorrow's Core PCE report. This is the Federal Reserve's favourite inflation indicator.

The general expectation is that the US Federal Reserve will cut interest rates three times this year, each by 25 basis points.

Simultaneously, the likelihood of an interest rate decrease by the European Central Bank in June is estimated at 81%, compared to a 64% probability for the Fed.

The main market movements are expected today because tomorrow is a public holiday in most Catholic countries for Good Friday.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EUR has dropped even lower. Overview for 29.03.2024

The primary currency pair continued to decline on Friday. The current EURUSD exchange rate stands at 1.0775.

Market activity will be limited today as Catholic countries observe the Good Friday public holiday. However, this is a stock market date, not a federal one, so statistics will still be published, although investors will not utilise them until Monday.

Today's statistics focus on February's US Core PCE report, the leading price index of personal consumption expenditures. The indicator is expected to have risen by 0.3% that month, slightly lower than in January. On a year-to-year basis, Core PCE could remain at the 2.8% level.

Price pressures remain elevated, allowing the Federal Reserve to keep interest rates high. This, among other things, supports the US dollar.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EUR dropped to the mid-February lows. Overview for 02.04.2024

The primary currency pair remains under significant pressure on Tuesday. The current EURUSD exchange rate stands at 1.0730.

US statistics released yesterday triggered a substantial strengthening of the USD. The data included the March ISM Manufacturing PMI. The report showed an increase to 50.3 points from 47.8 points the previous month. Firstly, the indicator surpassed the 50-point threshold that distinguishes between decline and growth. Secondly, it halted a 16-month downtrend.

The components of the new release appeared varied. Manufacturing parameters recovered, and the number of new orders increased. However, employment in the sector remains low, and commodity price pressure persists.

According to CME FedWatch, the market has slightly adjusted its expectations regarding the US Fed’s interest rate cut in June.

Today, the market focus is on the March manufacturing PMI in the eurozone and the February manufacturing order report in the US.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

GBP has found support. Overview for 03.04.2024

The UK pound sterling, paired with the US dollar, has entered positive territory. The current GBPUSD exchange rate stands at 1.2579.

Fresh statistics indicate that sentiment within the UK business sector is notably optimistic. The Manufacturing PMI for March rose to 50.3 points from the previous 47.5 points. The fact that the indicator has crossed the psychologically significant threshold of 50 points is undeniably positive.

Mortgage lending volume in February saw an increase to 1.51 million, up from 1.07 million the previous month. Net lending to individuals also expanded noticeably to 2.80 million from 0.69 million earlier.

The primary catalyst lies in the recovery of domestic demand.

British authorities expect that households will be inclined to increase spending this year.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EUR recovered its losses. Overview for 04.04.2024

The primary currency pair is moving upwards on Thursday. The current EURUSD exchange rate stands at 1.0844.

The euro's recovery against the US dollar is due to yesterday's comments from Federal Reserve Chair Jerome Powell regarding future interest rates. In fact, he merely confirmed that the Fed would rely on recent statistics when making interest rate decisions. The market responds positively to this, suggesting stability, and the Fed is gradually preparing for an interest rate cut in June.

Considering this, the US employment market statistics for March, which are due for release on Friday, are critical.

The consensus forecast suggests that the unemployment rate remained at 3.9%, while average wages surged by 4.1% y/y compared to 4.3% previously. The nonfarm payrolls report might show a 205 thousand increase after skyrocketing by 273 thousand in February.

The probability of an interest rate rise in June is currently estimated at 60%.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

NZD halted its growth. Overview for 05.04.2024

The New Zealand dollar, paired with the US dollar, has come to a pause. The current NZDUSD exchange rate stands at 0.6006.

The Kiwi dollar has regained a relatively stable position. The market turned in favour of currencies other than the US dollar after Federal Reserve officials once again expressed their doubts about the likelihood of a near-term interest rate cut.

These deliberations will be endless until the Fed makes a final decision and announces it to the market.

Nevertheless, the market consensus forecast for the NZD suggests that the Kiwi will rise this year, following the AUD's trajectory and benefitting from the weakening of the US dollar exchange rate.

Signals from the Reserve Bank of New Zealand are reasonably consistent. It has previously stated that it remains focused on controlling inflation.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

AUD managed to rise. Overview for 08.04.2024

The Australian dollar increased against the US dollar on Monday. The current exchange rate for AUDUSD stands at 0.6578.

The Aussie remains in a sideways movement globally. A month ago, AUD was at approximately the same level. An unexpectedly strong US employment report reduced anticipation that the Federal Reserve may initiate a monetary policy easing phase as early as June, allowing currencies other than the USD to stabilise their positions.

Australian statistical data showed that new home loans grew less than forecasted in February. The construction of new homes slowed down, which appeared to impact the bank's lending parameters. The Reserve Bank of Australia's interest rate remains at a twelve-year high of 4.35% per annum. At the last meeting, the RBA left it unchanged for the third consecutive time but refrained from wording suggesting an increase in the rate.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

GBP is aiming for growth. Overview for 09.04.2024

The British pound, paired with the US dollar, maintains positive momentum. The current GBPUSD exchange rate stands at 1.2657.

Meanwhile, it is worth noting that GBP gains appear relatively modest as the market still experiences pressure from the trajectory of the US dollar. The chances of an interest rate cut from the Federal Reserve have significantly decreased compared to the levels seen earlier in the year. Initially, investors expected six rate cuts but now only anticipate a maximum of three.

The latest comments from the US Federal Reserve chair, Jerome Powell, indicating that the Fed is in no hurry to make essential decisions, were supported by data on prices and employment. The US economy is clearly in a more stable position than it appeared at the beginning of the year, which is positive news for the US and the US dollar but not for interest rate prospects.

The market has already factored in the Bank of England’s soft stance on interest rates and the declining inflation parameters in the UK. Core inflation in the UK is currently holding steady at 4.5%, significantly higher than the 2% inflation target, ruling out a scenario of rapid interest rate cuts.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

JPY is under strong pressure. Overview for 10.04.2024

The Japanese yen remains in a weakened position against the US dollar. The current USDJPY exchange rate stands at 151.80.

Bank of Japan governor Kazuo Ueda finally clarified the Japanese regulator's future actions. The monetary policymaker noted that the BoJ will not directly react to the yen's exchange rate fluctuations. In this way, the Bank of Japan refuted market speculations that a steep decline in the JPY may force it to raise interest rates rapidly.

Ueda stated that the BoJ will not change its monetary policy in response to exchange rate fluctuations. BoJ officials are confident that, while a weak yen will push up import prices, this alone will not lead to an increase in borrowing costs.

However, if the risk of a surge in wages emerges and inflation exceeds the 2% target, the Bank of Japan may need to consider revising its monetary boundaries.

In March, the yen dropped to a 34-year low against the US dollar and remains under significant pressure.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

JPY hits new lows. Overview for 11.04.2024

The Japanese yen has dropped even deeper against the US dollar. The current USDJPY exchange rate stands at 152.98.

The yen collapsed under pressure from the US dollar after US treasury bond yields rose. This happened amid the publication of March inflation statistics, which completely inverted market expectations. Now, the market believes that the wide gap between the interest rates of the Bank of Japan and the US Fed will remain in force. This factor has the strongest impact on the JPY exchange rate.

Japanese authorities continue to hint at a possible intervention in currency fluctuations if exchange rate movements become excessive and disorderly, but this has long ceased to impress anyone.

The Japanese Ministry of Finance is perhaps considering the appropriate timing for any action. Yet for now, fiscal authorities continue to reiterate the same message day after day: "We are observing, monitoring, and ready for anything".

The government perfectly realises that factual intervention will only provide a short-term respite for the yen. That is why financial interventions have yet to occur.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EUR surrendered without a fight. Overview for 12.04.2024

The primary currency pair is sliding down on Friday. The current EURUSD exchange rate stands at 1.0682.

The strengthening of the US dollar is associated with low expectations from the US Federal Reserve's interest rate for this year. In January, the market expected six interest rate cuts; in March, it expected three, while today, it only anticipates two. Such forecasts are due to the publication of robust US statistics that increase the inflationary component.

The European Central Bank's meeting concluded yesterday. The interest rates remained unchanged.

In the commentary, the ECB mentioned that it would be appropriate to lower the interest rate if the core inflation dynamics and the strength of monetary policy gave more confidence in the CPI nearing the target levels. The regulator mentions the possibility of easing monetary conditions in its accompanying statement for the first time.

In fact, from December to now, the ECB has gone from firm statements to soft remarks.

Some market participants have already begun anticipating aggressive ECB rate cuts in the upcoming months, but such forecasts are unlikely to be grounded.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team